Associated Banc-Corp (ASBC) in Green Bay, Wis., reported that its third-quarter income increased 32% from a year earlier, to $45 million.

The $22.7 billion-asset company's net interest income rose 2% from a year earlier, to $155.6 million. Commercial loans rose 19% from a year earlier, to $8.9 billion; residential mortgages increased about 13%, to $3.2 billion.

Credit quality improved as net chargeoffs, nonaccrual loans and potential problem loans all fell compared to a year earlier. Associated did not record a loan-loss provision in the third quarter.

Noninterest income rose more than 17% from a year earlier, to $81 million. Trust service fees climbed 6% from a year earlier, to $10.4 million, and mortgage banking more than tripled from a year earlier.

Noninterest expenses increased more than 6% from a year earlier, to $170 million. Personnel and occupancy expenses rose almost 5% from a year earlier, to $95.2 million. Legal and professional fees climbed 79%, to $7.7 million, mostly related to changes to Associated's Bank Secrecy Act practices. The company entered into a consent order with the Office of the Comptroller of the Currency earlier this year to bring its Bank Secrecy Act program into compliance with federal law that requires banks to detect and report suspicious activities such as possible money laundering.

Associated also said Wednesday that it would close a dozen branches as it continues to trim expenses and improve efficiency. It previously consolidated 21 branches and sold three in Illinois. For the third quarter, the company's efficiency ratio was almost 70%.

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